Workers’ compensation insurance is a no-fault insurance system. In the compensation bargain created by the California Workers’ Compensation Act, you give up your right to challenge a claim of negligence causing injury, and your employees give up the right to sue you for far greater damages in civil court. Essentially, you are liable for work-related injuries and illnesses, but your employees usually cannot sue for additional damages.
If there is any doubt that workers’ compensation is applicable to a particular situation, the Division of Workers’ Compensation (DWC) generally rules in favor of coverage. Workers’ compensation coverage benefits employers by making workers’ compensation the “exclusive remedy” for workplace injuries or illnesses. However, there are exceptions to workers’ compensation exclusivity, either created by statute or court decision. For examples, see
Covered Employers and Employees
Exceptions to the Exclusive Remedy of Workers’ Compensation in “Exclusive Remedy for Workplace Injuries.”